Homeownership

While it may seem natural that a severe downturn would trigger a rising level of displacement, mounting evidence suggests that widespread fraud by lenders has led to foreclosures that should have and could have been avoided. This is the backdrop for ongoing talks between the big banks and a coalition of state attorney generals to reach a settlement that avoids future litigation. There are credible estimates that banks saved at least $25 billion by failing to comply with the law.

While it may seem natural that a severe downturn would trigger a rising level of displacement, mounting evidence suggests that widespread fraud by lenders has led to foreclosures that should have and could have been avoided. This is the backdrop for ongoing talks between the big banks and a coalition of state attorney generals to reach a settlement that avoids future litigation. There are credible estimates that banks saved at least $25 billion by failing to comply with the law. We should expect a commensurate fine, but we should focus efforts on keeping families in their homes and support more mortgage modifications. Here’s a podcast describing some ideas promoted by Senator Jeff Merkley to do just that.

Homeownership has been receiving a lot of attention these days. (And in case you weren't aware, June is National Homeownership Month). In the wake of falling home values, foreclosures, and widespread mortgage fraud, it is quite common to hear sound bites about homeownership.

Our social policy system is riddled with inequities. I often focus on the disparities between how we incentivize savings and encourage families to build wealth. While those on the upper half of the income ladder are able to access tax incentives as homeowners and when they contribute to a range of designated accounts, families with lower incomes and fewer resources are largely shut out. This critique was the impetus for creating a new type of account that could incentivize savings for those currently excluded, the Individual Development Account (IDA).

IDAs are designed to support savings for the purchase of specific assets, such as buying a home, pursuing post-secondary education, or capitalizing a small business, by matching the deposits of program participants. Over the last 15 years, community groups across the country made IDAs available to their constituents. One of the features of this experience that has been so remarkable is the commitment of IDA proponents to learning from the experience. From the beginning, a thorough research agenda was developed and has produced a growing body of knowledge. In many ways, this is a model for how social policymaking should work. New ideas can be put into action, their impacts assessed, and subsequent approaches can be refined or abandoned. The process is often iterative and takes time, but the nature of social science requires openness to acquiring new information and an ability to place it in context.

A new study by a team of researchers from Center for Social Development at Washington University in St. Louis, University of North Carolina, and the Brookings Institution offers a new learning opportunity.

Somewhere between addressing predatory lending, mortgage origination, and what to do with the onslaught of vacant and abandoned properties, we failed to really address everything in the middle. Maybe that is a little harsh. Several academics, state Attorneys General, and media outlets reported problems in mortgage servicing, scary trends like the difficulty of reaching someone with authority on the phone or the consistent loss of paperwork.

Individual Development Accounts are designed to support savings for the purchase of specific assets, such as buying a home, pursuing post-secondary education, or capitalizing a small business, by matching the deposits of program participants. The concept of matched savings has been promoted as a means to broaden asset ownership among populations missed by current policy. Recently, a study was released evaluating the ten-year impacts of a specific Individual Development Accounts program in Tulsa, Oklahoma focused on increasing homeownership.

At this point, it is common knowledge that widespread fraud by lenders and servicers played a role in the housing crisis and has led to foreclosures that should have and could have been avoided. This is the backdrop for a set of ongoing talks between the big banks and state attorney generals to reach a settlement that avoids future litigation. The banks and their servicers appear to be on the hook for some serious cash. The question is how much.

The New America Foundation invites you to participate in an exploratory session to discuss opportunities to work across federal agencies to leverage and maximize the benefits for low-income families of a HUD program known as the Family Self-Sufficiency (FSS) Program.  FSS combines three elements that together provide a strong framework for individuals’ progress toward economic security: (a) the stability of federal rental assistance (in the form of public housing or a housing voucher); (b) a financial incentive for families to increase their earnings in the form of an escrow account th

Last week, I attended the Federal Reserve Community Affairs Research Conference on “The Changing Landscape of Community Development” where researchers from the Fed and Universities around the country shared their most recent findings on the challenges facing low-income communities and community development policy-makers.  The conference covered a wide range of topics from foreclosures to farmers markets with eight discussion panels and keynote speeches by Columbia University professor and aut

At our event yesterday, "Mitigating the Impacts of the Current Foreclosure Crisis," Senator Jeff Merkley (D-OR) laid out a convincing case for paying more attention to the ongoing foreclosure crisis, putting distressed homeowners first and supporting homeownership as a goal for America in the future.